Serica Energy has agreed to acquire Pharos Energy in a cash transaction valuing the London-listed oil and gas producer at approximately $194.5 million, or £145.7 million.
The Pharos Energy board has unanimously withdrawn its recommendation for a competing offer from Ratio Petroleum and now intends to support the Serica Energy proposal.
Under the agreed terms, Pharos Energy shareholders will receive 28.6683 pence in cash and a special dividend of 4 pence for each share. The total consideration is 32.6683 pence per share, rising to 33.6 pence when a previously paid final dividend is included.
The cash and special dividend consideration represents a 20.7% premium to the equivalent value offered by Ratio Petroleum. It is also 28.6% above the Pharos Energy closing share price on 23 June, the final trading day before the competing offer was announced.
The acquisition would add operations in Vietnam and Egypt to the Serica Energy portfolio. On a pro forma basis, the combined group would hold 2P reserves of 156.8 million boe, up 13%, and 2C resources of 129.4 million boe, up 15%.
Its expected 2026 exit production rate would increase to approximately 70,000 boepd. The combined group would also acquire approximately $45 million in cash held by Pharos Energy as of 30 June 2026.
The transaction will be implemented through a court-sanctioned scheme of arrangement. It remains subject to shareholder approval, court approval and regulatory clearances in Vietnam and Egypt.
Serica Energy expects the acquisition to become effective in the first half of 2027.
The Pharos Energy board has adjourned shareholder meetings scheduled for 17 August to consider the Ratio Petroleum proposal.
Serica Energy Chief Executive Officer Chris Cox said the transaction would support the company’s international expansion strategy while adding reserves, resources and cash-generating production. He also said the acquisition would provide a platform for growth in Southeast Asia alongside continued investment in the UK North Sea.
Pharos Energy Chief Executive Officer Katherine Roe said the board supported the Serica Energy offer because it provided shareholders with a higher cash premium than the competing proposal.
